Salvador’s is a producer of authentic Hispanic foods, such as salsa and chips. Their products are high quality and affordable. Salvador’s has been around for three years, and it has enjoyed great popularity. It was once a business that only served the Hispanic community. Now it is a much more popular business.
Salvador’s has several goals that they want to achieve in the next three-years. The first goal is to increase sales to two million dollars by year 5. Salvador’s also would like gross margins to be above 55%. Salvador’’s would like to have 40 outlets where they can distribute their products. They aim to be the best Hispanic food producer in the region with an expanding geographic distribution.
Salvador’s currently offers two main products. Their salsa is the company’s flagship product. It is well-known for its freshness, uniqueness and high quality ingredients. Salvador’s introduced their salsa originally in hot form, but the market demanded milder temperatures. So Salvador’s now offers a medium and mild versions. Salvador’s also offers fresh chips with both yellow and blue corn to complement their salsa.
Salvador’s has chosen three primary customer groups to target their products. The grocery stores are the first. These grocery stores will then be sold directly to the consumer. This market is growing at 75%. There are currently 53 potential customers. The second group is wholesale distributors. This segment is growing at 100% with five potential distributors. The last customer segment is restaurants which have a 45% growth rate. There are 18 potential restaurants customers. Salvador’s originally targeted the Hispanic communities. Salvador’s realized that their products are more popular than they thought and responded accordingly. The Hispanic community was initially targeted because of its exciting growth rate. The community has been growing at 22% a year, almost double the average of the overall US population.
Salvador’s high-price point has few direct competitors, despite the presence of many regional and national competitors. Salvador’’s can take advantage of this situation to continue being the leader in authentic Hispanic cooking.
Salvador’s strong management team, Ricardo Torres (Pat Torres), will ensure long-term growth. Pat has 12 year experience in the food and beverage industry. Five years ago, Pat was the manager of a four-store Tex-Mex restaurant chain. This provided Pat with incredible insight and industry knowledge that reinforced the idea to start a business from scratch. Salvador’s six-years of experience in financial control, gained through his work as a CPA at Arthur Andersen, is now being brought by Ricardo. Salvador’s management team due to its experience will assist Salvador in achieving his dream of becoming the leading Hispanic food company.
Salvador’’s has started to achieve profitability, and the company expects a modest net income in three years. Sales will generate a modest profit margin. The financials within the plan further reinforce the exciting nature of this business.
1.1 Objectives
- Over the next three years, you can expect to see significant sales growth.
- Increase gross margin % relative to the current product line, and maintain it.
- To meet market demand, add products and services again at a high gross margin.
- Increase inventory turnover and reduce the cost of goods while maintaining high quality products.
- To offer Hispanics rewarding and satisfying jobs.
1.2 Mission
Salvador’s was built on offering the highest quality and value in its authentic hot salsa, filled with the history of the Hispanic community. The family recipes are rich in ethnic heritage and have been handed down over the generations. They were searching for genuine products that are made with only the best ingredients. This consumer wanted a change. They were looking for authentic, down-home Hispanic salsa.
Salvador’’s was the first to respond. It started with a hot salsa and then added milder and more hot salsa. Next came yellow and blue chips. We continuously review what is out there and what isn’t. This is how we strive to provide the best possible customer service.
Our success in a market driven primarily by consumer demand will be ensured by improving on the existing products and services and providing new products and/or services.
1.3 Keys for Success
- High quality products that differentiate themselves from all others in taste and price.
- Providing service, support, and a better than average margin to our dealers.
- Increase gross margin by %
- In order to increase sales volume, introduce new products.